Pan-India 3G spectrum licence now nearly twice base price


New Delhi: India Thursday concluded 64 rounds of an auction to award radio frequency spectrum for third generation telecom services in the country, with the provisional winning price for a nationwide licence rising to Rs.6,967.55 crore, almost twice the reserve price.

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The provisional winning price was 99.07 percent higher than Rs.3,500 crore reserve price fixed by the government for a pan-India licence.

According to latest data available on the website of Department of Telecommunications, Delhi remained the hot favourite amongst bidders attracting the highest bid at Rs.850.42 crore, followed by Mumbai receiving a price of Rs.752.38 crore, while two additional players were still in the fray for the three available slots in both the service areas.

The provisional winning price, at end of 64th round, stood at Rs.710.62 for Tamil Nadu and Rs.696.96 crore for Maharashtra.

Four states – Rajasthan, Orissa, Assam and Jammu and Kashmir – could not attract even a single player at the end of the 11th day of the auction, which began April 9.

The 3G services will facilitate much faster connectivity than what is available now and enable applications such as Internet TV, video-on-demand, audio-video calls and high-speed data exchange.

Slots for three-four players are available in each of the 22 circles into which the country has been geographically divided for these services.

The government has already given Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) spectrum for 3G services on the condition that they will pay the same licence fee as would be levied on private players after the auction.

Along with the fee that will be eventually paid by the two state-run enterprises for the licences, the government will provisionally get at least Rs.28,227.87 crore from the auction.

This is on the presumption that every available slot gets filled at the provisionally approved price.

Communications Minister A.Raja, during question hour in the Rajya Sabha, Thursday said the ongoing auctions to award radio frequency spectrum for 3G telecom services and for rolling out broadband wireless internet services could raise Rs.45,000 crore, Rs.10,000

crore more than anticipated.

“We anticipated that the auction would raise Rs.35,000 crore. It may go up to Rs.45.000 crore,” the minister said.

Nine telecom companies — Bharti Airtel, Reliance Communications, Vodafone Essar, Idea Cellular, Tata Teleservices, Aircel, Etisalat, S Tel and Videocon Telecommunications –are participating in the online auction process.

It is a simultaneous auction for 22 circles over a secure website. At each round, the price is hiked from between 10-1 percent based on demand.

The auction is being held from 9 a.m. to 7.30 p.m. on all days, except Sundays and national holidays. The process will end only when the demand is equal to the number of slots available in each circle.

The bid data, including the winning companies’ names, will be made public after the auction’s completion and approval by the government.

The winning firms will have to deposit the money within 10 days after the auction.

The successful bidders would be allowed to offer 3G services on a commercial basis from Sep 1.